Source: LKQ Corporation
July 26, 2018
- Revenue growth of 23.3% to $3.03 billion
- Organic revenue growth for parts and services of 7.2%
- Growth of net income attributable to LKQ stockholders of 4.0% to $157 million; adjusted net income increased 17.6%
- Second quarter 2018 diluted EPS attributable to LKQ stockholders of $0.50; adjusted diluted EPS of $0.61
- 2018 annual earnings guidance updated
CHICAGO, July 26, 2018 (GLOBE NEWSWIRE) — LKQ Corporation (Nasdaq:LKQ) today reported record revenue for the second quarter of 2018 of $3.03 billion, an increase of 23.3% as compared to $2.46 billion in the second quarter of 2017. For the second quarter of 2018, parts and services organic revenue growth was 7.2% and acquisition revenue growth was 12.7%, while the impact of exchange rates was 2.9%, for total parts and services revenue growth of 22.8%.
Net income attributable to LKQ stockholders for the second quarter of 2018 was $157 million, up 4.0% year-over-year. On an adjusted basis, net income attributable to LKQ stockholders was $192 million, an increase of 17.6% as compared to the $163 million for the same period of 2017. Diluted earnings per share attributable to LKQ stockholders for the second quarter of 2018 was $0.50 as compared to $0.49 for the same period of 2017, an increase of 2.0%. On an adjusted basis, diluted earnings per share attributable to LKQ stockholders for the second quarter of 2018 was $0.61, an increase of 15.1% as compared to $0.53 for the same period of 2017.
Dominick Zarcone, President and Chief Executive Officer of LKQ Corporation, stated, “I am very pleased with the 7.2% organic parts and services revenue growth we achieved in the quarter as it reflects a sequential organic revenue growth rate improvement in each of our North American, European and Specialty segments, which witnessed organic parts and services growth of 7.4%, 8.3% and 4.1%, respectively. This growth reflected a reversal of some of the transitory items noted in our commentary in the first quarter of 2018, as well as better than expected performance in each business. I am particularly proud of the ability of our European teams to address the challenges we faced in the first quarter and deliver a 130 basis point improvement in sequential Segment EBITDA margin.”
On a six month year-to-date basis, revenue was $5.75 billion, an increase of 19.8% from $4.80 billion for the comparable period of 2017. Parts and services organic revenue growth for the first six months of 2018 was 5.5%. Net income from continuing operations attributable to LKQ stockholders for the first six months of 2018 was $310 million, an increase of 6.3% as compared to $292 million for the first half of 2017. Diluted earnings per share from continuing operations attributable to LKQ stockholders for the first six months of 2018 was $0.99, an increase of 5.3% as compared to $0.94 for the same period of 2017. On an adjusted basis, diluted earnings per share from continuing operations attributable to LKQ stockholders for the first six months of 2018 was $1.16, an increase of 13.7% as compared to $1.02 for the same period of 2017.
Balance Sheet and Liquidity
Cash flow from operations totaled $329 million on a six-month year-to-date basis, of which approximately $115 million was invested in capital expenditures and other long term assets and $162 million was used to pay down credit facility borrowings. As of June 30, 2018, we had approximately $1.6 billion available under our credit facilities. Combined with approximately $345 million of cash and cash equivalents at June 30, 2018, we had approximately $1.9 billion in available liquidity, an increase of $234 million over our available liquidity as of December 31, 2017.
On May 31, 2018 the Company announced the closing of its acquisition of STAHLGRUBER GmbH (“STAHLGRUBER”). Headquartered in Germany, STAHLGRUBER is a leading European wholesale distributor of aftermarket spare parts for passenger cars, tools, capital equipment and accessories with operations in Germany, Austria, Slovenia, Croatia, and with further sales to Switzerland. STAHLGRUBER’s facilities include 188 sales centers and an approximately 128,000 square meter advanced logistics center located near Munich, Germany serving more than 100,000 professional clients and offering over 500,000 SKUs. The European Commission cleared the acquisition except with respect to STAHLGRUBER’s wholesale automotive parts business in the Czech Republic, which is currently being reviewed by the Czech Republic competition authority. The Czech Republic wholesale business represents an immaterial portion of STAHLGRUBER’s revenue and profitability.
In addition to our acquisition of STAHLGRUBER, during the second quarter of 2018 we acquired four wholesale businesses in Europe for a total net consideration of approximately $7 million. Also in the second quarter, LKQ’s European operations opened two branches in Western Europe and 15 branches in Eastern Europe.
About LKQ Corporation
LKQ Corporation (www.lkqcorp.com) is a leading provider of alternative and specialty parts to repair and accessorize automobiles and other vehicles. LKQ has operations in North America, Europe and Taiwan. LKQ offers its customers a broad range of replacement systems, components, equipment and parts to repair and accessorize automobiles, trucks, and recreational and performance vehicles.
For additional details, including financial and supplementary data, view the full Press Release on the LKQ Investor Relations website.